Headline risk can have a tremendous impact on asset values, especially when economic fundamentals are fragile. Our local experts untangle rumor from reality, cross-check sources, and assess whether risks have already been priced in. We help manage risk along short-, medium-, and long-term horizons, providing a reality check and adept sounding board to challenge our clients’ thinking.

Through our GlobalSource Direct platform, you can reach out to a top in-country expert and quickly get the insights you need, on topics from a country’s ability to pay, to the effect of an unexpected political upheaval on bond prices.

Just saw your post on the new Central Bank Head — what’s going to be the impact?

Contrary to the popular view, we believe the previous bank head did a very poor job of handling pressure from the low interest rate lobby, so our bar for the new bank chairman is very low. His selection removes a major short-term hurdle for our markets—this is still the best-placed country to benefit from the trio of negative policy rates, weak dollar and low energy prices. However, we anticipate only a short-term rally–political risks, a new expansion in CAD or a Fed rate hike by the U.S. could kill it.

Access to funding, the size and depth of capital markets, supply chain risk and political risk can all impact an organization’s ability to operate in the emerging markets. Our top in-market experts assess credit risks, provide in-depth analyses of relevant policies and decision-makers, and help managers anticipate key dates and milestones. We offer tailored insights into economic fundamentals, labor policies, court systems, trade policy and access to FX, with medium- and longer-term views and forecasts.

Through our GlobalSource Direct platform, you can reach out to a top in-country expert and quickly get the insights you need, on topics from government-funded infrastructure spending to tax trends to the impact of a recent foreign exchange strategy.

What can we expect after the most recent announcements hinting at a floating, market-determined exchange rate?

We’re skeptical. This is not feasible now. Bringing a market-determined rate into the picture needs credible anchors and, so far, there are none. The gap between the official rates remains abysmal, fiscal accounts are deeply in the red, and regulations hinder private capital inflows. The authorities can’t be expected to loosen the grip. At best, we’d like to see access to foreign exchange for businesses becoming more predictable and transparent.

Medium-term currency prospects, the fiscal stance of the country, and the balance of payments outlook can add up to have material impact on the enterprise value. For acquisitions and divestments, these factors entail real risks, especially when enterprise value is linked to business performance over a period of 2 or 3 years. Our macroeconomic risk analytics contribute significantly to due diligence processes associated with M&A.

Through our GlobalSource Direct platform, you can reach out to a top in-country expert and quickly get the insights you need, on topics from interest rate trends to market conditions and potential operational costs.

What do you expect to see in terms of unit labor costs in the next year, and what does it mean for the industrial sector?

We’ve seen unit labor costs go up by 20% since 2010 to date, and we expect that trend to continue. This is common knowledge—what isn’t as well understood in the market is the extreme degree with which these costs have cut into profit margins, resulting in stagnant industrial output and huge losses in competitiveness. We have a lot of empirical data about this in our most recent report.

In emerging markets, things aren’t always what they seem — or what consensus suggests.
Savvy investors and business leaders trust GlobalSource Partners to get the real story
before making major decisions.

GlobalSource Partners: Unparalleled Expertise

Above the noise. Our experts are trusted economists, former finance ministers and central bank heads, and the go-to authorities in their countries. Our clients recognize us as "brilliant thinkers and writers, with the relationships and knowledge to go beyond consensus." We provide candid, unbiased, unfiltered insights that contribute to better investment and business decisions.